PKK fighters "are trying to flee southwards in panic", the Turkish military said.

"Local Iraqi groups are expected to prevent members of the terrorist organisation - the biggest enemy of regional peace and stability - from entering their region and being given protection there," it added.

Ankara has long accused the Iraqi Kurds of tolerating and even aiding the PKK by providing them shelter, weapons and ammunition.

Ali al-Dabbagh, the Iraqi government's spokesman, acknowledged that Turkey was "suffering from the terrorist PKK organisation" but that military action was not the answer.

"We know the threats that Turkey is facing but military operations will not solve the PKK problem," he said.

He said Turkish commanders had assured Iraq that the "operation will be a limited one and it will not violate certain standards that they have set".

Turkey and the Iraqi Kurds are both US allies, and the likelihood of armed confrontation between the two has been a major cause of concern for Washington as it seeks to avoid a relatively stable area of conflict-torn Iraq being thrown into chaos.

US balancing act

On Sunday, the US also called on Ankara to wrap up its incursion as swiftly as possible.

"The shorter the better," Robert Gates, the US defence secretary, said on a visit to Canberra.

Gates, who is expected in Ankara next week, suggested that Turkey use economic and political measures to win over Turkey's sizeable Kurdish community and erode popular support for the PKK, listed as a terrorist group by Turkey and much of the international community.

"Just using the military techniques are not going to be sufficient to solve the problems," Gates said.

But Washington is also providing Turkey – a Nato ally – with military intelligence on PKK movements.

The PKK and another militant Kurdish group called on Kurdish youths across Turkey and Europe to unleash urban violence in response to the offensive.

"If they want to wipe us out, our youths should make life in the cities unbearable," PKK leader Bahoz Erdal was quoted by the Firat news agency as saying.

"Kurdish youths should unite... and burn hundreds of cars every night."

Erdal also condemned the US and Iraqi Kurds for helping the Turkish operation.

Ankara says an estimated 4,000 PKK fighters are holed up in northern Iraq and use the region as a springboard for cross-border attacks as part of their campaign for self-rule in the Kurdish-majority region of southeast Turkey.

The conflict has claimed more than 37,000 lives since the PKK took up arms in 1984.